Iain Martin is a political commentator, and a former editor of The Scotsman and former deputy editor of The Sunday Telegraph. He is the author of Making It Happen: Fred Goodwin, RBS and the men who blew up the British economy, published by Simon & Schuster.. As well as this blog, he writes a column for The Sunday Telegraph. You can read more about Iain by visiting his website

The benefits cap is designed to cheer up hard-pressed taxpayers

Save us from surveys. The University of Somewhere has published a study on something. They have examined it in detail and their research indicates that somehow the thing that everyone thought was the case is not actually quite like that. As a remedy, government investment (more money from taxpayers) is suggested. Something must be done.

Of course such studies have their place. Policy must be evidence-based, and so on. But the spread of surveys also reflects the current obsession with "crunching" data. I hasten to add that some of my favourite people "crunch" data. It is important work. I just think we need to remember that it was only relatively recently that we witnessed the effects of one of history's biggest ever exercises in data-crunching. The risk-management systems and controls built by the banking industry were made out of a mountain of data and data analysis. The theory was that it had made finance, and the rest of us, safer. It turned out to be false comfort, which encouraged otherwise clever people to ignore ethics and overlook less easily quantifiable truths about the susceptibility of mankind to manias, groupthink and crazy behaviour in a boom. After the resulting crisis, and before we stake everything else on big data, perhaps we should exercise a little small-c conservative scepticism.

Anyway … today's hot survey with numbers in it is about the government's benefit cap. The policy caps the amount that a household can receive in benefits at £500 per week, and £350 for a single person. The Chartered Institute of Housing examined the impact in Haringey, one of four pilot areas.

According to the BBC: "It said just 10% of 747 households affected were known to have found jobs and nearly 50% got extra funds from the council to make up for money lost."

Seventy-four households in one borough with no one in work finding a job sounds like a good start to me, and far better than the alternative of them not having a job. If the human impact – in terms of self-respect and the positive message communicated to any children in those households – can be replicated in every borough in London and in cities and towns across the UK, and in the end it turns out to be more like 20 per cent or 30 per cent going into work, then that will be many thousands of people with their life chances enhanced. For those involved that's got to be a big improvement compared to a life permanently on benefits.

But the CIH Chief executive is worried. Grainia Long said: "The Government said the benefit cap would save money and encourage people into work, but this report shows it is far from achieving both of those aims in one of the worst affected areas."

The Government contests the conclusions of the survey, and says that incomplete data was used.

But the argument about data and cost savings misses the central point, as these surveys tend to. The benefits cap was designed by ministers not just to encourage work. It was also designed to cheer up hard-pressed taxpayers.

Of course the aim of welfare reform is to tackle the scourge of long-term unemployment. The emphasis must be on liberating those trapped in workless despair. And anyone who has listened to Iain Duncan Smith, rather than relying on the caricature painted by his opponents, will know that he sees himself as being on a great moral mission to tackle poverty and welfare dependency. Incidentally, his worrying unwillingness to listen when confronted with flaws in his schemes is certainly not evidence of heartlessness. It is more likely a by-product of his zeal and his determination not to be diverted.

But by capping benefits, ministers also wanted to emphasise to squeezed taxpayers that not all of their money is going down the drain when many millions of taxpayers have seen their standards of living hit by the worst downturn in seven decades. The attitudes of those getting up for work every morning have hardened since the crash. Not hardened, I hope, towards those in genuine distress or facing hardship not of their making, but certainly towards people who have never worked and think that this is all the fault of someone else.

London – of which Haringey is a part – is full of foreign workers, busily keeping retail and all manner of other industries going. Why should a cleaner or doorman in a London hotel who lives in Haringey work flat-out, when their neighbour gets more than their salary in benefits year after year? It is wickedly unfair and it infuriates many taxpayers.

For this reason, the benefits cap cuts across the usual Left-Right divide. In a safe Labour seat ask those in work how they feel about families who have not worked for generations getting even the £500 a week available after the introduction of restrictions. The response won't be any more printable than it is in a safe Tory seat or a three-way marginal. The market for the alternative view against the benefits cap – which involves a kind of "Hey, no way Thatcher" sub-1980s invocation to more spending paid for by other people already paying a lot of tax – is vanishingly small and overwhelmingly metropolitan.

The Labour leadership knows all this, which is why it has to tread very, very carefully, at least until it gets into office.

The benefits cap is the Government's most popular policy. The only complaint that many voters have about it is that they wish ministers would go further.